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FY2023 Subsidy-Based Infrastructure FS Project
for Overseas Expansion
Project Reports
R3 Energy subsidy Utilities

Business feasibility study project for building a hydrogen
supply chain using methylcyclohexane (MCH)Mitsubishi Corporation, Chiyoda Corporation

Project Reports: Mitsubishi Corporation, Chiyoda Corporation

1Overview of infrastructure/energy infrastructure

In this feasibility study project, we built an early-stage business model for the entire hydrogen supply chain, from production to sales of hydrogen, with partners in hydrogen supplying countries (Australia and Chile) and a hydrogen consuming country (Singapore). We then extracted issues and examined the possibility of turning it into a business. We focused on examining the technological, economic, and legislative aspects of the SPERA Hydrogen*1 supply chain business.

*1:
“SPERA Hydrogen™” means methylcyclohexane (MCH) as a hydrogen carrier, and the dehydrogenation catalyst (which extracts hydrogen from MCH) , the proprietary technology developed by Chiyoda Corporation forms the core of the SPERA Hydrogen technology for transporting and storing hydrogen.
Project Reports: Mitsubishi Corporation, Chiyoda Corporation

2Distinguishing characteristics,
such as competitive advantages

  • The hydrogen supply chain demonstration project that used MCH as a hydrogen carrier was completed in 2020. The technology readiness level is higher than that of other hydrogen carriers.
  • While MCH and toluene will be transported and stored, both products are already traded in the market; therefore, existing vessels and storage equipment can be used.
  • MCH and toluene are liquids at ambient temperature and pressure, have relatively low toxicity, and are chemically stable, making them easy to handle.
Project Reports: Mitsubishi Corporation, Chiyoda Corporation

3Needs of target countries and regions,
and their issues and solutions

From the perspective of addressing climate change and ensuring energy security, reducing reliance on fossil fuels is becoming a common issue around the world. Against this backdrop, adoption of hydrogen is being sought especially in industries and areas that are difficult to implement decarbonization through electrification on the premise of using renewable energy. Singapore, which we consider as a hydrogen consuming country for this project, has committed to achieve net zero emissions by 2050. As the amount of Singapore’s renewable energy is limited, we anticipate that the adoption of hydrogen using SPERA Hydrogen technology will contribute to the achievement of this goal.

Project Reports: Mitsubishi Corporation, Chiyoda Corporation

4Expected impact of the project

Project Reports: Mitsubishi Corporation, Chiyoda Corporation
1

Solutions to the needs and issues identified in 3 and their benefits

By building a hydrogen supply chain that uses MCH as a hydrogen carrier and expanding the use of hydrogen, we will be able to curb greenhouse gas emissions from the power and industrial sectors, thereby contributing to measures combatting climate change. In addition, from the perspective of ensuring energy security, the project can contribute toward solving the global issue of breaking away from the dependence on fossil fuels (Currently, over 90% of power generated in Singapore is generated from gas-fired power generation; therefore, the country will be able to diversify its energy sources through the adoption of hydrogen).

2

Indicators showing the impact of the project

When compared to existing gas-fired power generation, CO2 (including Scope 1, 2 and 3 types) emissions from hydrogen power generation that utilizes a supply chain employing MHC will be approximately one-half or less.
*As the amount of CO2 emissions changes depending on the configuration of equipment, accurate figures need to be calculated for each project.

3

Progress of the project and orders received after the study

For the hydrogen supply chain in Singapore, we are proceeding with some of the early-stage engineering work (Pre-FEED) while advancing discussions with potential buyers of hydrogen. Going forward, we will develop the business from both a technical and commercial aspect in more detail, and manage the project so that we can make a final investment decision in 2024. In addition, building on the accomplishments of this project, we are also working on a project for a hydrogen supply chain using SPERA Hydrogen in Europe.

5Future plan for the project

Regarding the hydrogen supply chain project for Singapore using SPERA Hydrogen, the final investment decision will be made in 2024, and after the construction period, commercial operation will start in 2026, and hydrogen supply and sales will begin.
In addition, for the hydrogen supply chain using SPERA Hydrogen in Europe, commercial operation is scheduled to start in 2027.

Project Reports: Mitsubishi Corporation, Chiyoda Corporation

6Opportunities to roll out the project

  1. Since the decarbonization and carbon neutralization of industrial sectors is an imminent issue in Japan as in other countries, and as the adoption of hydrogen in large amounts will gain momentum in the future, we anticipate that it will lead to the establishment of a hydrogen supply chain using SPERA Hydrogen in Japan, while taking advantage of track records established overseas and existing infrastructure.
  2. As we are working on building a hydrogen supply chain using SPERA Hydrogen in Europe in countries such as the Netherlands and Germany, we will be able to roll out the results of this project horizontally. In addition, we are considering the import of hydrogen using SPERA Hydrogen in Taiwan.

7Benefits of using the subsidy-based high-quality infrastructure/energy infrastructure FS project

We were able to confirm again that further efforts should be made to reduce costs across all processes (production of hydrogen, production of MCH, marine transport, dehydrogenation) that comprise the hydrogen supply chain. As we will proceed with the project for building hydrogen supply chains using SPERA Hydrogen in Singapore and Europe, we reaffirmed that in order to (1) establish global and commercial-scale hydrogen supply chains using SPERA Hydrogen, which is one of Japan’s leading technologies, (2) export a large quantity of hydrogen to Japan in the future, and (3) enhance the degree of contribution and influence of the Japanese government and Japanese companies in global society, public support is essential for covering project development expenses, equipment/operational costs and selling price of hydrogen, especially during the phase of launching the hydrogen market.

8Inquiries regarding this project

Mitsubishi Corporation
Contact person: Ryo Kogure
TEL: +81-70-2254-6806
email: ryo.kogure@mitsubishicorp.com